N-nitrosodimethylamine demethylase (P-450j) is a major nitrosamine metabolizing enzyme in human and rat liver. Under certain dietary and pathophysiologic conditions, this enzyme can also be found in kidney and lung. Metabolism of nitrosamines by P-450j results in the production of electrophilic intermediates that can bind and mutate DNA. Regulation of the levels of this enzyme, therefore, may be important in nitrosamine-mediated carcinogenesis. P-450j can be elevated five- to sixfold in rat liver, kidney and lung through administration of ethanol. This increase is due to post-transcriptional events since P-450j mRNA levels do not change. In the chemically induced diabetic rat, P-450j is also markedly elevated; however, this increase is accompanied by an mRNA is specifically stabilized in the liver, lung and kidney of the diabetic rat. In contrast to these instances of post- transcriptional regulation, P-450j is transcriptionally activated during development. To explore the mechanism of this developmental regulation, the rat and human P-450j genes were first isolated and sequenced. Both genes contain nine exons and share considerable nucleotide similarity immediately upstream of their transcription start sites. This region may be an important cis-acting regulatory domain in the P-450j gene. Analysis of the rat and human P-450j genes during development revealed that cytosines upstream of both the rat and human genes are specifically demethylated coincident with their developmental activation.